2015: On World
War and Russia Sanctions (Sol, Portugal)
"The end
of 2014 - year of the centenary of the Great War, mother of all wars and 20th
century history - should lend some caution to Western officials. … How does an industrial
and diplomatic competition between 'civilized' powers cross over into the imbecilic
massacre of Flanders? … Washington and NATO continue to antagonize Moscow and Obama
has approved new sanctions. … In August 1941, the Americans embargoed oil sales
to Japan, which is how Tokyo obtained about 75 percent of its supply. Then they
then froze its financial assets. Pearl Harbor came four months later."
The end of 2014 - year of the centenary
of the Great War, mother of all wars and 20th century history - should lend some
caution to Western officials.
Dozens of titles are coming out about the origins of the
conflict to reflect on the puzzle that remains: how does an industrial and
diplomatic competition between “civilized” powers cross over into the imbecilic
massacre of Flanders?
How is it that an assassination in an out of the way place could determine such
carnage within the world's power centers? And why would statesmen and prudent
bureaucrats, with many years of realpolitik experience, allow themselves to get
carried away with the chauvinistic and revanchist sentiments of demagogues?
In principle, the crises of 2015 have to do with political
issues, some political-economic, others political-religious.
Today let's talk about the former.
The price of a barrel of crude, as a reference and master
index of the market value of other energy products, is a key standard of world
geopolitics. Because energy is a commodity that all states must evaluate and
use - as exporters or importers - its value determines the value of many other
goods and services essential to modern life.
Despite the many books and articles carrying energy
forecasts - sometimes euphoric, sometimes pessimistic, some recommending confidence
in the invisible hand of the free market, others state surveillance and containment
- the right recipe in terms of predictions still hasn't been produced. And when
energy is combined with politics and geopolitics, the calculations become yet more
difficult.
The most complex reality at this moment is related to the
situation with Putin’s Russia, simultaneously the victim of the low oil prices,
its most valuable export, and economic sanctions from the West, imposed for
political reasons.
Posted By Worldmeets.US
For Russia to balance its accounts, the price would have to
be hover at $100 per barrel, well above the current $47 (Jan. 6). If some of
the Western companies in the sector, under the pressure of sanctions, withdraw from
joint ventures [with Russia], the losses from the break in investment with the
added technological gap would in the short term contribute to a lowering of
production, especially in the Arctic regions of Siberia and the deep offshore.
The Russian Central Bank is stepping up efforts to defend the currency at the
expense of interest rates and its dollar reserves, but this type of combat is
always lopsided.
Washington and NATO continue to antagonize Moscow and Obama has
approved new sanctions. Putin retains the strong support of Russians, but feels
increasingly trapped and with fewer economic and diplomatic options.
In August 1941, the Americans embargoed oil sales to Japan,
which is how Tokyo obtained about 75 percent of its supply. Then they then
froze its financial assets. Pearl Harbor came four months later.
